HF 3588

as introduced - 86th Legislature (2009 - 2010) Posted on 03/09/2010 11:22am

A bill for an act
relating to transportation; modifying provisions related to transportation
contracts; amending Minnesota Statutes 2008, section 161.315; repealing
Minnesota Rules, parts 1230.3000; 1230.3100; 1230.3200; 1230.3300;
1230.3400; 1230.3500; 1230.3600; 1230.3700; 1230.3800; 1230.3900;
1230.4000; 1230.4100; 1230.4200; 1230.4300.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2008, section 161.315, is amended to read:

161.315 PROTECTION OF PUBLIC CONTRACTS.

Subdivision 1.

Legislative intent.

Recognizing that the preservation of the integrity
of the public contracting process of the Department of Transportation is vital to the
development of a balanced and efficient transportation system and a matter of interest to
the people of the state, the legislature hereby determines and declares that:

(1) the procedures of the department for bidding and awarding department contracts
exist to secure the public benefits of free and open competition and to secure the quality of
public works;

(2) the opportunity to be awarded department contracts or to supply goods or
services to the department is a privilege, not a right; and

(3) the privilege of transacting business with the department or local road authority
should be deleted text begin denied to deleted text end new text begin bestowed only on trustworthy and responsible new text end persons deleted text begin convicted of a
contract crime deleted text end in order to preserve the integrity of the public contracting process.

Subd. 2.

Definitions.

The terms used in this section have the meanings given them
in this subdivision.

(a) "Affiliate" means a predecessor or successor of a person by merger,
reorganization, or otherwise, who is, or that has as an officer or director an individual
who is, a relative of the person or an individual over whose actions the person exercises
substantial influence or control, or a group of entities so connected or associated that one
entity controls or has the power to control each of the other entities. "Affiliate" includes
the affiliate's principals. One person's ownership of a controlling interest in another entity
or a pooling of equipment or income among entities is prima facie evidence that one
entity is an affiliate of another.

deleted text begin (b) "Contract crime" means a violation of state or federal antitrust law, fraud, theft,
embezzlement, bribery, forgery, misrepresentation, making false statements, falsification
or destruction of records, or other criminal offense in connection with obtaining,
attempting to obtain, or performing a public or private contract or subcontract.
deleted text end

deleted text begin (c) "Conviction" has the meaning given it in section 609.02, subdivision 5.
deleted text end

deleted text begin (d) deleted text end new text begin (b) new text end "Debar" means to disqualify from receiving a contract or from serving as a
subcontractor or material supplier deleted text begin as provided by Laws 1984, chapter 654, article 2,
section 8 deleted text end .

deleted text begin (e) deleted text end new text begin (c) new text end "Person" means a natural person or a business, corporation, association,
partnership, sole proprietorship, or other entity formed to do business as a contractor,
subcontractor, or material supplier and includes an affiliate of a person.

deleted text begin (f) deleted text end new text begin (d) new text end "Pooling" means a combination of persons engaged in the same business or
combined for the purpose of engaging in a particular business or commercial venture and
who all contribute to a common fund or place their holdings of a given stock or other
security in the hand and control of a managing member or committee of the combination.

deleted text begin (g) deleted text end new text begin (e) new text end "Suspend" means to temporarily disqualify from receiving a contract or
from serving as a subcontractor or material supplier deleted text begin as provided by Laws 1984, chapter
654, article 2, section 8 deleted text end .

deleted text begin (h) deleted text end new text begin (f) new text end "Relative" means an individual related by consanguinity within the second
degree as determined by the common law, a spouse, or an individual related to a spouse
within the second degree as determined by the common law, and includes an individual in
an adoptive relationship within the second degree as determined by the common law.

Subd. 3.

Prohibitions.

Except as provided in subdivision 4:

(1) neither the commissioner nor a county, town, or home rule or statutory city
may award or approve the award of a contract for goods or services to a person who is
suspended or debarred;

(2) neither the commissioner nor a county, town, or home rule or statutory city may
award or approve the award of a contract for goods or services under which a debarred or
suspended person will serve as a subcontractor or material supplier;

(3) a person to whom a contract for goods or services has been awarded may not
subcontract with or purchase materials or services from a debarred or suspended person
for performance of that contract; and

(4) when a debarred person sells or otherwise transfers to a relative or to any other
party over whose actions the debarred person exercises substantial influence or control,
a business, corporation, association, partnership, sole proprietorship, or other entity, or
an affiliate of the entity, that is ineligible by virtue of the debarment to contract with a
governmental entity, the sold or transferred entity remains ineligible for these contracts
for the duration of the seller's or transferor's debarment.

Subd. 4.

Exceptions.

The commissioner may terminate a debarment by order, or
the commissioner or a county, town, or home rule or statutory city may award a contract
to a debarred or suspended person when:

(1) that person is the sole supplier of a material or service required by the
commissioner or a county, town, or home rule or statutory city;

(2) the commissioner determines that an emergency exists as defined in section
161.32, subdivision 3;

(3) the commissioner of administration determines that an emergency exists as
defined in section 16C.10, subdivision 2;

(4) in the case of a contract to be awarded by a county, town, or home rule or
statutory city, the governing body thereof determines by resolution that an emergency
exists that will result in a road, street, or bridge being closed to travel; or

(5) the contract is for purchasing materials or renting equipment for routine road
maintenance.

deleted text begin Subd. 5. deleted text end

deleted text begin Duration of debarment. deleted text end

deleted text begin A person who has been convicted of a contract
crime must be debarred for a period of not less than one year. This subdivision applies to
contract crime violations which occur after June 30, 1985.
deleted text end

Subd. 6.

Preexisting contracts.

The disqualification of a contractor or its affiliate
does not affect the contractor's or its affiliate's obligations under any preexisting contract.

new text begin Subd. 7. new text end

new text begin Rules. new text end

new text begin The rules relating to debarment, suspension, and reinstatement of
vendors adopted by the commissioner of administration apply to debarments, suspensions,
and reinstatements under this section. In the event the rules adopted by the commissioner
of administration are inconsistent with this chapter, this chapter governs.
new text end

Sec. 2. new text begin REPEALER.
new text end

new text begin Minnesota Rules, parts 1230.3000; 1230.3100; 1230.3200; 1230.3300; 1230.3400;
1230.3500; 1230.3600; 1230.3700; 1230.3800; 1230.3900; 1230.4000; 1230.4100;
1230.4200; and 1230.4300, new text end new text begin are repealed.
new text end